SINGAPORE (Aug 14): Midas Holdings, the manufacturer of aluminum alloy extrusion products for the railways in China, reported a near trebling of 2Q earnings to RMB55.5 million ($11.3 million) from RMB18.7 million a year ago.
Revenue rose 32.1% to RMB505.6 million mainly attributable to the inclusion of revenue of RMB109.6 million from the group’s Aluminium Alloy Stretched Plates Division which accounted for 21.7% of total revenue in the quarter.
Revenue from the Aluminium Alloy Extruded Products Division rose 3.5% to RMB394.7 million from RMB381.4 million, making up 78.1% of total revenue in 2Q17.
The Power Industry and Others segments accounted for the remaining 7.2% and 6.4% respectively. The Others segment in the division comprised mainly of the supply of aluminium alloy rods and other specialised profiles for industrial machinery.
Midas’ gross profit margin for 2Q17 increased to 31.4% compared to 27.8% in 2Q16, mainly due to higher gross profit margin for the group’s Aluminium Alloy Extruded Products Division, which was 31.6% in 2Q2017 compared to 28.0% in 2Q2016. The gross profit margin for the group’s Aluminium Alloy Stretched Plates Division was 31.0% during the period under review.
Other income increased by RMB6.8 million to RMB9.5 million in 2Q17 from RMB2.7 million in 2Q16 to RMB9.5 million in 2Q17. This was mainly due to unrealised foreign exchange gain of RMB5.7 million arising from US dollar denominated medium term notes.
Share of profits from the group’s associated company, CRRC Nanjing Puzhen Rail Transport Co., (NPRT) was RMB7.1 million in 2Q17 as compared to RMB10.6 million in 2Q16. This was mainly due to a different project mix in the respective periods and an increase in operating expenses.
In its outlook, Midas says China’s railway industry is poised to continue its growth path, backed by the authorities’ continued railway investments to expand the country’s railway network, including the passenger rail transportation sector covering metro and high-speed train projects.
In a separate filing, Midas says subsidiary Jilin Midas Aluminium Industries Co. has won three supply contracts worth RMB184.4 million in total from customers in China.
Shares in Midas closed 1 cent lower at 21 cents.